Un-permitted guest house

[Terrel L. Shields]

"Appraise it with no value to the illegal structure."

That will cost you your license in my state....unless you state a Hypothetical or only value a portion of the estate (everything but the GH)

It contributes what it contributes. Pretending it is not there is not an option.

 

[Mike Kennedy]

Appraise it with no value to the illegal structure. In your highest and best use analysis detail why it is illegal and what would the cure be. Also be very specific stating which parts of the zoning ordinance state it is illegal and what the authorities have stated will be an acceptable cure. Then let the underwriter decide.
Love Smokey Bear's response. Not only an attorney, an English major at that!

Please post a link to any USPAP Rule, or other Regulatory Guideline, which supports for the first sentence above? Thanks in advance.

 

[kthunter]

I am having a similar issue with an accessory unit and just found out that the Realtor involved filed a compaint against me to the Appraisal Board. The property I appraised has a detached accessory unit with over 1,200 sq.ft. of finished living space. Land use only allows an accessory unit up to 900 sq.ft. Marked the use as illegal since it does not conform with the current land use. To top it off the structure is only permitted as a detached garage. Although it is not legally permitted I do not consider it an illegal use since its use is allowed, however I concluded that it was illegal since it exceeded the threshold for the maximum size accessory unit allowed. I really feel that the realtor is ticked off because I am the 3rd appraiser to value the property and her deal still can't close. So she's taking it out on me! I've never had a complaint filed against me and am not looking forward to going in front of the Appraisal Board if it gets that far. Any suggestions from anyone on what to do besides running for the hills?

 

[kthunter]

I forgot to mention the county indicates that the accessory unit as detached finished living space, but like I said before was never permitted for this use.

 

[Atlanta CG]

I thought the Hypothetical was understood. Sorry about the confusion.
John

 

[Judy Burr]

Illegal apartment

I just appraised a farmhouse that the owner remodeled the breezeway and the 2 car garage into an apartment for his adult son. Now he is gone and the owner wants a refi. Those rooms are vacant, because they are detached, and not part of the house, really. This was an FHA, so I could not use that part of the structure for GLA, BUT, I had to give it some value, because a buyer would consider this some sort of amenity. There are no similar sales or listings, of course. So, I decided a buyer would consider that space as a bonus and I gave it that same value as a finished basement with similar rooms. I have appraised some houses with a room in a detached garage, so similar to that is called a bonus room here. Anyway, the reviewer said it passed and I had explained it all, so that is how I appraised it. It was all done as Ag zoning, and the owner sold the land and so it is now illegal to use it as an apt as it is zoned R1, so he would have to ask to have it rezoned to R2. The zoning dept said it would be $750 a day fine if he rented it.

 

[Webbed Feet]

I thought the Hypothetical was understood. Sorry about the confusion.
John

Brother Marshall, assuming the assignment involves a SFR loan that has to be reported on a 2005 version 1004, due to the imbedded SOW, your solution would not then work. As that would mean a reconciliation check box would have to be used to bring in such a HC. Forcing the use of CB3, and then the lender could not get the hypothetical cleared. The use of a hypothetical must be credible. Where is your proof there is any market acceptance for simply pretending it isn't there, or proof the property owner plans on tearing it down, or proof the lender is going to require it being torn down? I would, at this point, assume there is no indication of any of those, therefore there is no credibility for the use of such a HC. We can't just pull "it has no value" out of our tail feathers. We don't get to use HCs and EAs willy nilly just to make the complex easy to do.

P.S. Besides, that is a SOW matter. Regarding SOW we are to do things like communicate with our clients about such matters, often before we do them, not just after we've done them.

 

[Atlanta CG]

Hmmm, let me digest that. Never too old to correct long-standing beliefs.